After the incentives, the bans
China has been generous with subsidies for electric vehicles and, although revised now as per the “Made in China 2020 (MIC20)” roadmap, will pursue incentivising people to buy electric rather than combustion.
The Government has tuned down the EV bonus schemes for consumers beginning of 2019. Many Western media have reported this as an economic measure, which is absolutely a component, but MIC20 has been extremely clear about the different steps to electrification: start with generous subsidies for consumers and OEMs to activate EV adoption, encourage production of cheap EVs (local brands produce now EVs that cost less than USD 10,000) and then enhance the quality and range of the EV production.
This is the current state of China’s EV strategy. Only long-range EVs are withheld for incentives and OEMs lose their production subsidies unless they optimise the production process and innovate on materials and recycling.
A second part of the strategy is now activated; a variety of new measures will be gradually implemented across China:
- Ban on gasolinepowered vehicles
- Ban on sales of gasolinepowered vehicles
- Ban on the production and sales of gasolinepowered vehicles
These measures are relatively new and are meant to overcome consumers’ reticence to buy electric instead of petrol.
As China is executing its electrification plan, the hydrogen implementation is slowly coming to life as well. Focusing on public transport and logistics vehicles, hydrogen buses and trucks are becoming available on the Chinese market and fuelling infrastructure is being built. China sees electric and hydrogen as compatible solutions with their own use-cases. As was the case for electric, Chinese OEMs have started to invest in partnerships with foreign hydrogen vehicle manufacturers.